$40b submarine project announced

MORE than $200 million will be spent on design studies for 12 new submarines for the Australian Defence Force, as part of a $40 billion investment in submarines touted as "the largest procurement project the nation has ever undertaken".

Defence Minister Stephen Smith and Prime Minister Julia Gillard on Thursday released the Defence Force Posture Review, which outlined what needs to be done to keep the nation's military assets up to date.

The $40 billion future submarines project will eventually replace the Collins class of submarines currently used by defence.

The review also noted a probable increase in defence presence at Ipswich's Amberley air base, and a need to "ensure sufficient land and airspace is available to meet future demands".

Mr Smith said that while a 2009 defence white paper recommended investing in the Joint Strike Fighter program - for 14 new fighter jets - the project would be delayed by two years.

He said this would produce a saving to Tuesday's Federal Budget of between $1.4 and $1.6 billion, while a decision not to buy self-propelled artillery guns would save a further $225 million.

Mr Smith also said the next defence white paper would be brought forward one year, to begin in the first half of 2013, as part of a regular five-year review of the defence budget.

Ms Gillard said there would be no impact on overseas operations, equipment, or defence numbers in next week's budget, but that specific details would be released on Tuesday.

The $214 million will be spent researching the best options for design, construction and procuring the workforce to build the 12 future submarines in South Australia.

But Ms Gillard said the long-awaited update to Australia's submarines would unfold over decades, with the problem-plagued Collins class submarines able to last until 2031 on paper.

Mr Smith said that the government would not allow a gap in combat capability to occur and the government would ensure that mistakes made when procuring the Collins submarines would not be repeated.

He said contractual obligations to buy the 14 strike fighter jets would remain, and the delay to 12 of the jets would align Australia with a similar timeframe that the United States was already committed to.